Trump doubles down on capital gains, payroll tax cuts to stimulate economy

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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="President Trump is calling for two tax cuts as he eyes new ways to provide relief to workers as tens of millions lost their jobs&nbsp;last month.” data-reactid=”13″>President Trump is calling for two tax cuts as he eyes new ways to provide relief to workers as tens of millions lost their jobs last month.

In a briefing with the media Friday, Trump said his administration has been “throwing money” at the problem as it considers additional stimulus measures.

“One thing we could do is a payroll tax cut,” Trump said. “That’s one thing a lot of people would like to see. Another thing they’d like to see is a capital gains tax cut.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="CORONAVIRUS STIMULUS PHASE FOUR PROPOSALS INCLUDE THESE TAX POLICIES” data-reactid=”16″>CORONAVIRUS STIMULUS PHASE FOUR PROPOSALS INCLUDE THESE TAX POLICIES

Former Trump Senior Economic Adviser Stephen Moore has been calling for a payroll tax suspension as a means to accelerate growth without adding to the federal deficit.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The payroll tax is paid separately from federal income taxes and funds Social Security and Medicare. Employers and employees each pay 6.2 percent for Social Security&nbsp;and 1.45 percent for Medicare, and an additional 0.9 percent is levied on the highest earners.” data-reactid=”18″>The payroll tax is paid separately from federal income taxes and funds Social Security and Medicare. Employers and employees each pay 6.2 percent for Social Security and 1.45 percent for Medicare, and an additional 0.9 percent is levied on the highest earners.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="A suspension of the payroll tax could incentivize employers to hire more workers by reducing their payroll costs while giving&nbsp;employees&nbsp;a boost in their paychecks.” data-reactid=”19″>A suspension of the payroll tax could incentivize employers to hire more workers by reducing their payroll costs while giving employees a boost in their paychecks.

However, there are concerns that Social Security and Medicare funding would be harmed in the process.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="It has been previously suggested that&nbsp;companies would eventually be responsible&nbsp;for repaying the money to Social Security and Medicare, just at a later date.” data-reactid=”21″>It has been previously suggested that companies would eventually be responsible for repaying the money to Social Security and Medicare, just at a later date.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="CORONAVIRUS STIMULUS: TRUMP WANTS BUSINESS MEALS, ENTERTAINMENT TO BE TAX DEDUCTIBLE AGAIN” data-reactid=”22″>CORONAVIRUS STIMULUS: TRUMP WANTS BUSINESS MEALS, ENTERTAINMENT TO BE TAX DEDUCTIBLE AGAIN

Meanwhile, reducing capital gains taxes has traditionally been favored by Republicans as a means to encourage investment. Capital gains taxes are paid on the difference between what an individual originally paid for a property or investment vs. what it sells for — at the time it is sold.

The current top capital gains rate sits at 23.8 percent.

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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="As previously reported by FOX Business, administration officials have discussed a handful of other tax proposals as potential candidates for phase four stimulus measures. In addition to Trump’s favored policies, White House economic adviser Larry Kudlow has talked about expanding full, immediate expensing, and Trump has called for reinstating the full deduction for business meals and entertainment.” data-reactid=”26″>As previously reported by FOX Business, administration officials have discussed a handful of other tax proposals as potential candidates for phase four stimulus measures. In addition to Trump’s favored policies, White House economic adviser Larry Kudlow has talked about expanding full, immediate expensing, and Trump has called for reinstating the full deduction for business meals and entertainment.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Experts expect the debate in Congress moving forward will be centered on&nbsp;whether to continue spending in order to stimulate the economy – or to transition to other pro-growth measures. The federal government has already spent nearly $3 trillion to combat the devastating effects of the pandemic.” data-reactid=”27″>Experts expect the debate in Congress moving forward will be centered on whether to continue spending in order to stimulate the economy – or to transition to other pro-growth measures. The federal government has already spent nearly $3 trillion to combat the devastating effects of the pandemic.

Despite a bleak jobs report on Friday, detailing the loss of a record 20.5 million jobs in April, Trump said he thinks 2021 has a chance to be one of the best years economically the U.S. has ever had due to pent-up demand.

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